Essay on Fonderia Di Torino S.P.A. - 1076 Words

Fonderia di Torino S.P.A. Case analysis report Fonderia di Torino S.p.A, founded in 1912 by Benito Cerini, was a manufacturing company who produced metal castings using semi-automated molding machines. The company’s main line of business was the production of precision metal castings for use in automotive, aerospace, and construction equipment. The company excelled at this and was awarded because of the quality of its products. The mainly European customers of Fonderia di Torino were original-equipment manufacturers (OEM). The OEMs insisted on quality products. The OEMs gave preferential treatment to Fonderia di Torino. The confidential market-demand information that Fonderia di Torino received helped increase the precision of†¦show more content†¦In order to proceed, we can make the number 95 percent of the book value at that time. |Resale value of the new machine 6 years later= |= |239875 | |95%* Book value =252,500*95%Show MoreRelatedFonderia Di Torino S.P.A.1148 Words   |  5 PagesFinance Case Study: Fonderia di Torino S.p.A. Case Overview: Company considering purchase of Vulcan Mold-Maker automated molding machine. Machine prepares sand molds into molten iron using iron castings, automates manual intensive process. Questions: 1. Assess the economic benefits of acquiring the Vulcan Mold-Maker machine. What is the initial outlay? What are the benefits over time? What is an appropriate discount rate? Does the net present value (NPV) warrant the investment in theRead MoreFonderia Di Torino S.P.A.1704 Words   |  7 Pagesconsidered before the project is accepted or rejected. Question 1: What is the basic nature of the problem in this case? Answer: The basic nature of the problem in this case is all about capital budgeting issue that was being faced by Fonderia di Torino S.p.A. in decided to have some resources investments in order to manage their production throughputs. Managing director of this specialty foundry must decide whether to approve a major investment to automate part of her plant s production processRead MoreFonderia Di Torino S.P.a Essay727 Words   |  3 PagesFonderia di Torino, S.p.A Midterm Individual Case Fonderia di Torino, S.p.A is a manufacturing company who produces metal castings using six semi-automated molding machines. However, they are currently considering purchasing a Vulcan Mold-Maker machine to replace the six machines currently in place. The firm needs to consider all costs in deciding whether to keep the current machines or purchase the Vulcan Mold-Maker. Buying the Vulcan machine will result in year 0 outflows of 1.01 millionRead MoreFonderia di Torino S.P.A. Case Study860 Words   |  4 PagesFonderia di Torino S.p.A. 1. Please assess the economic benefits of acquiring the Vulcan Mold-Maker machine. What is the initial outlay? What are the benefits over time? What is an appropriate discount rate? Does the net present value(NPV) warrant the investment in the machine? Initial Case Outlay Price of new machine (1,010,000) Current after-tax market value of old machine [130,000+{(415,807-130,682) -130,000}*0.43]= 196,704 Net outlay for new machine -1,010,000+196,704 = -813,296 Appropriate